# In the matter of Vaman Fabrics Pvt. Ltd. IA No. 263-2019 in CP(IB) No. 27-NCLT-AHM-2018

> NCLT judgment dated 2019-07-17. Citation: TCN-2019-NCLT-02476. The case involves an application (IA 263 of 2019) filed in conjunction with a Corporate…

- **Court:** NCLT
- **Order date:** 17 Jul 2019
- **Citation:** TCN-2019-NCLT-02476
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/vaman-fabrics-pvt-ltd-ia-no-263-2019-in-cpib-no-27-nclt-ahm-2018-aca19ce7

## Summary

### Background

The case involves an application (IA 263 of 2019) filed in conjunction with a Corporate Petition (CP(IB) No. 27/NCLT/AHM/2018) before the Ahmedabad Bench of the National Company Law Tribunal (NCLT). The application was filed by the Resolution Professional seeking an order for the liquidation of the Corporate Debtor, Vaman Fabrics Pvt. Ltd. The Corporate Insolvency Resolution Process (CIRP) had commenced earlier, and the Committee of Creditors (CoC) had resolved to recommend liquidation as no resolution plan was received, and the company's assets had already been sold by the secured creditor, resulting in a NIL liquidation value.

## Facts

Premraj Ramratan Laddha, the Interim Resolution Professional (IRP) for Vaman Fabrics Pvt. Ltd., filed an application (IA 263 of 2019) before the Ahmedabad Bench of the National Company Law Tribunal (NCLT) seeking liquidation of Vaman Fabrics Pvt. Ltd. The Corporate Insolvency Resolution Process (CIRP) had been initiated earlier, and the application was filed under Sections 33 and 34 of the Insolvency and Bankruptcy Code (IBC). The Committee of Creditors (CoC) had resolved in its fourth meeting held on March 30, 2019, to recommend liquidation as the company had not received any resolution plan, was not a going concern, and had no business operations for the last three years. The company had turned into a Non-Performing Asset (NPA) since March 2016, and its

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## Issues and analysis

### Issue 1: Whether the application for liquidation of the Corporate Debtor, Vaman Fabrics Pvt. Ltd., should be …

**Ratio:** Section 33 of the Insolvency and Bankruptcy Code allows for the initiation of liquidation

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**Reasoning:** The court reasoned that the CoC had unanimously voted in favor of liquidation due to the

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**Interpretation:** Section 33 is interpreted to mean that if the CoC, representing the financial

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**Application:** In this case, the CoC had unanimously voted for liquidation, and no resolution

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## Parties

- **Judges:** Harihar Prakash…; Manorama…
- **Appellants:** Premraj Ramratan…
- **Respondents:** Vaman Fabrics…
- **Advocates:** Mohit G…; Aditi C…; +1 more

## Timeline

- **2018-01-01 — CP(IB) F…**: Corporate Petition (CP(IB)…
- **2019-03-30 — CoC Meet…**: Committee of Creditors (CoC)…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 33(1) — Initiation of liquidation](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-33)

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